Missions at roughly two of five foundations have shifted since the start of the year because of COVID-19. And, increased need evolved into more giving in 2020 with plans to continue for the rest of the year. As many as 15 percent of foundations are trying new charitable activities in 2020, according to a new report.
Those are among the findings reported in “2020: The Year That Changed everything - How Private Foundations are Meeting this Moment,” released by Foundation Source, a Fairfield, Conn.-based provider of support services for private foundations. The report was based on survey responses from 105 of the firm’s 1,670 private, non-operating foundation clients.
Almost 40 percent of respondent reported shifting their foundation’s mission since the start of this year, primarily due to COVID-19 and the increased need of nonprofits. A similar but slightly higher proportion of respondents (42 percent) have increased the dollar amount of their grantmaking since the start of 2020, and the same percentage expect to do so for the remainder of this year. In addition to COVID-19 and the increased need of nonprofits, respondents cited social injustice concerns as factors in their decisions.
Some foundation executives reported employing other philanthropic capabilities for the first time, or plan to during 2020. Some 15 percent said they granted directly to individuals rather than to nonprofits; 11 percent awarded scholarships, and 11 percent also engaged in direct charitable activities, such as distributing clothes to people in need, without the aid of a nonprofit.
While 86 percent of respondents said they will continue to solely grant to nonprofits for the rest of this year, 14 percent plan to give in other ways:
- 8 percent via granting to individuals;
- 4 percent by awarding scholarships;
- 5 percent by engaging in direct charitable activities; and,
- 3 percent via making program-related investments (PRI), such as a loan.
“Given the extraordinary challenges of 2020 -- COVID-19, high unemployment, social turmoil -- the entire philanthropic community is under pressure to do more with finite resources,” Foundation Source CEO Susan Friedlander Calzone said in a press statement announcing the report. “Private foundations have been meeting the challenges head-on; they’ve adapted their strategies and are doing new and amazing things with their philanthropy,” she said.
Foundation Source also released data on grantmaking behavior of its foundation clients during the second quarter of 2020 versus the same time period in 2019.
Grantmaking data for the second quarter for all Foundation Source clients indicated a 45-percent increase in the total dollar amount granted, and a 2-percent increase in the total number of grants issued. “While the number of grants they made increased modestly, the value of those grants spiked considerably in this time of heightened need,” Calzone said.
The Q2 data also displayed clients’ willingness to try new things, with granting directly individuals jumping by almost 900 percent. “For some of the foundations, 2020 has been a ‘call to action’ that has altered their grantmaking not only to address immediate hardships but to ensure funds are deployed as effectively as possible over the long term as well,” Calzone said.